04-29-2006, 08:53 AM
| |||
| |||
 Re: Is loan interest for option exercise deductibel on Schedule A? <deja_bhoot2000[at]yahoo.com> wrote in message news:1145922941.193916.136120[at]g10g2000cwb.googlegroups.com... - quote - > I have nonqualified stock options (NQSO) from my employer that is
Probably not. But check in with misc.taxes.moderated.> vested. In order to exercise, I have to pay > -- the offering price (fair market value as of the time the option > was granted); PLUS > -- Fed ncome tax + SS + Medicare + CA SDI + CA taxes = about 45% on > the "paper gain" > For example, if the option was granted at $10, and the curernt price of > stock is $50, I have to pay $10 + 45% of the ($50-$10) gain = $10 + $18 > = $28 per share. > Company offers an arms-length loan at market interest rate to help with > this exercise. The interest rate would be between 6.5% and 7.25% > (depending upon credit rating). > Would this interest be deductible as investment expense on Schedule A, > if I itemize? > Bhoot 704set |
|
#-1
04-25-2006, 09:03 AM
| |||
| |||
| Is loan interest for option exercise deductibel on Schedule A? I have nonqualified stock options (NQSO) from my employer that is vested. In order to exercise, I have to pay -- the offering price (fair market value as of the time the option was granted); PLUS -- Fed ncome tax + SS + Medicare + CA SDI + CA taxes = about 45% on the "paper gain" For example, if the option was granted at $10, and the curernt price of stock is $50, I have to pay $10 + 45% of the ($50-$10) gain = $10 + $18 = $28 per share. Company offers an arms-length loan at market interest rate to help with this exercise. The interest rate would be between 6.5% and 7.25% (depending upon credit rating). Would this interest be deductible as investment expense on Schedule A, if I itemize? Bhoot |
| Tags |
| deductibel, exercise, interest, loan, option, schedule |
Similar Threads | ||||
| Thread | Forum | Replies | Last Post | |
| Is interest paymennt on loan to exercise NQ stock options mdeductible?i deja_bhoot2000@yahoo.com: I have nonqualified stock options (NQSO) from my employer that is vested. In order to exercise, I have to pay -- the offering price (fair market... | Taxes | 7 | 05-15-2006 02:40 PM | |
| Option Exercise - Cost Basis 704set: When a covered call option is exercised on a stock, how is this reported. I know it becomes part of the cost basis. So what do you do? Reduce the... | Taxes | 10 | 05-08-2006 09:51 AM | |
| Exercise an equity option Flashbert: I am entering option exercise details, and Money (US version 2004) automatically calculates something called... "Price (incl. option costs):" What... | Microsoft Money | 1 | 10-11-2004 03:27 PM | |
| Interest on loan-Schedule B? sherry: I was repaid a loan with interest. Do my earnings simply go on Schedule B? Does it make a difference if I made the loan to my niece's husband who... | Taxes | 7 | 10-04-2004 03:17 PM | |
| Thread Tools | |
| Display Modes | |
| |
Linear Mode
